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After a decade of flirting with popular fashion and building such sub-Mercedes as the first M-Class at the risk of its reputation, Mercedes-Benz is getting back to its roots. The new M-Class, a luxury transportation module with style and elegance, is where it starts.

The 1998 W163 broke ground as a luxury crossover vehicle but hurt itself with early quality issues. The first M was too short on luxury for a Mercedes and didn’t have the expected ride, handling, and refinement. The 2006 W164 M-Class is new from the ground up. Its optional 5.0-liter V-8 is the only major component that carries over from the 2005 model, with power upped from 288 to 302 horses. Mercedes figures the ML500 will account for 25 to 30 percent of M-Class sales, with the rest going to the ML350 and its excellent 268-horse, 3.5-liter 24-valve V-6 that replaces and outpowers the old SOHC, 18-valve six. Both engines achieve SULEV emissions status for trucks and come standard with the smooth 7G-TRONIC transmission (its gearshift is an electronic control on the steering column and makes room for two big cupholders in the console). Most important, the new M ditches the old M’s platform for a unibody that allows for better, tighter panel gaps.

As for the switch from a truck frame, these were never meant to be serious off-roaders, and the new model, available again only with all-wheel drive, is now sans the W163’s two-speed transfer case, contributing to a 200-pound weight saving. Still, the new MLs are much more capable off-road than necessary. A hill-descent control uses ABS sensors and the seven-speed autobox to maintain single-digit mph on steep downhill runs. The optional Airmatic height-adjustable air suspension raises the body for an extra three inches of ground clearance (up to 77 mph). Order this option for off-roading; for lower approach/departure/ breakover angles, the new M-Class is longer, lower, and wider than the sport/utility it replaces.

Mercedes has further added four inches to the wheelbase and six inches to the overall length for better everything–interior space, ride, and looks. The grille, in the silver and chrome of the ML500, looks concept-car cool with its 40 tiny openings and truck-style oversized three-pointed star. The V-8 has brushed-chrome skidplates front and rear, 18-inch five-spoke wheels, and exclusive, square-shaped chrome dual exhausts. Chrome door handle trim and side molding trim come standard on the V-8, optional in an appearance package on the V-6. The M-Class’s profile suggests a wedge, with bold, integrated front overfenders and a slanted beltline melding into the integrated rear overfenders. The rear bumper has a bit of fat, but the tail is wide and aggressive-looking with eyebrow-like creases over its taillamps.

Cargo space is roughly equal to the old five-passenger model’s 72-and-a-half cubic feet overall, but it’s taller and deeper if not as wide. Despite the added length and wheelbase, Mercedes will not attempt to cram in a third row of seats, as it did for the W163. That’s because the new model’s platform is a launching pad for a troika of Merc crossover SUVs–sort of tall E-, CLS-, and S-Classes, if you will. The R-Class coming this fall is a longer, more stylish crossover with 2+2+2 seating. A stretched version of the M-Class, with a third row of seats is scheduled for a 2006 intro (see sidebar).

If the M’s exterior styling is a surprise, the interior will make your eyes pop. It looks like, well, a Mercedes. The best is, of course, the more luxurious ML500, a model that stickers for close to $60,000 with popular options. In lighter colors, the ML350 retains the old model’s two-tone dash, but its interior is an improvement, too. The 500 has chrome and dark wood accents, whereas the 350 has no chrome on the doors and substitutes the ML500’s dark wood accents for a lighter variety. Mercedes calls the stuff you get along the seat trim and sides of the seats, if you don’t order full leather, “Mercedes tex”–which is market-speak satirized in the movie “Lost in America” as “Mercedes leather.” Yes, it’s vinyl.

Mercedes may be returning to its luxury-car roots, but its option list for the M harks back to the days when power steering and automatic transmissions were “optional” in Chrysler Newports and Olds Deltas. The list includes Keyless Go, an option in our ML500 that we could easily forgo because of the chiming that warns you’re in park and constantly reminds you to take your key. There’s a standard iPod/MP3 hookup in the glovebox and optional wiring that lets you control it with steering wheel buttons. That seems checklist-worthy.

You’ll forgive, if not forget, the lengthy options list once you hit the road. Awkward and trucklike as the W163 was, the new M-Class is buttoned-down and refined. It rides and handles like a car, but keep in mind that some agility is lost when the center of gravity is raised. The longer wheelbase and unibody provide a solid and compliant ride. The view of the hood falls away from the driver quickly, as in the 1998 to 2005 models, and the steering is precise, although still a bit looser than the old BMW ideal–in that Merc kind of way.

For such a big crossover, the ML500 feels small and manageable, and the 302-horsepower, 5.0-liter V-8 is a lot of engine for it. Low-rev torque is especially good, making it easy to squirt into cross-traffic you’d normally wait to pass for a bigger opening. Brakes feel typically Mercedes, which means they’re among the best in class.

Our ML500 came with an adaptive damping system similar to the excellent system in the E500, only with three settings in place of two in the sedan. We were happy to keep it locked in the “sport” setting, although there are subtle, but noticeable differences ratcheting down through the normal setting to “comfort.” The sport setting will let you go deeper into turns–you’ll push (and we do mean push) the M to its tire adhesion limits more easily and confidently. The comfort settings simply translate to body roll, coming in more quickly and heavily, but not to any level of excess.

For the comfort trade-off on straight roads, it’s easier to spot the differences driving over single potholes and over manhole covers than on rough roads. In the sport setting, the M-Class’s rigid body feels go-kart stiff over those covers. Even the comfort setting falls short of being too soft. This is an improvement in every way over the old model, so don’t give in to that temptation to pick up a 2005 leftover for $100 under invoice. Don’t give in to the sportier BMW X5, either. If you need more handling than the M-Class offers, buy a conventional sedan. If you insist, the M-Class has a sport package available, and our track-test model, so equipped, has more aggressive tires than the more luxury oriented ML500 we tested with its 225/55R18 Michelins.

The ML500’s base price is $49,250 including destination; the ML350 starts at $40,500 (look at current Lexus RX 330 and Acura MDX prices if you think that’s too much). With so many options offered, $50,000 will be the going price for a typical V-6, which is about the same as a popularly equipped E500 wagon with 4Matic. That’s a lot of money for a model launched eight years ago with a sub-$34,000 base price designed to appeal to those who thought they couldn’t afford a Benz. The good news for bargain hunters intrigued with Mercedes’s intended return to luxury-car form is that with high residuals, leasing should again be the budget-stretching way into one of these new ones.

Mercedes is smart to leave its small, front-drive transportation modules, like the A- and B-Class, in Europe. Going downmarket with C-Class sport coupes didn’t work–but getting buyers into the marque with $35,000 sedans and $50,000 SUVs and moving them up into E-, S-, and CLS-Classes just might. As a key component in this new strategy, the M-Class succeeds.

Future Class DistinctionsMercedes’S seven-passenger supplement to the five-passenger M-Class will be built on a stretched version of the same platform, but it won’t be an M-Class. The model, planned to make its debut in late 2006, will have its own sheetmetal, three rows of forward-facing seats, and its own model designation. Benz had planned to call it the G-Class, but now there’s movement afoot to extend the life of the venerable Gelaendewagen in Europe. So the seven-passenger model could get an all-new designation so there’s no confusion with that model overseas.

For M-Class customers who’d like to take the new model on the Rubicon Trail, there’s an off-road package planned for the 2007 model year, with two locking differentials, two-speed transfer case, and the Airmatic suspension, including adaptive damping. We’re sure a Mercedes-Benz dealer can set you up with a ‘roo bar to go with that. Last, but far from least, is a new AMG version, ditching the three-valve supercharged V-8 for the new four-valve. Mercedes will preview the M-Class AMG at the Frankfurt show this September.

ML350, Pay To Play?How much power are you willing to pay for? Fifty-dollar fill-ups for the new Mercedes-Benz M-Class lends new meaning to that age-old question. The new ML350’s latest-generation Mercedes V-6, the 24-valve 3.5-liter, is just 14 horsepower short of the old ML500’s V-8 and 34 horses shy of the new 24-valve 5.0-liter V-8. It’s the rational choice, and with a base price nearly 20 percent lower than the V-8, it pretty much belongs in a different subsegment. The ML500 competes in price with the Land Rover‘s Range Rover, while the ML350 is in Lexus RX 330/Acura MDX territory.

The ML350 doesn’t have the same sense of urgency as its more powerful brother, and you’ll have to be more judicious about pulling out into traffic. While the V-6 is smooth, quiet, and refined around town, its exhaust segues to a sporty note. The seven-speed automatic transmission holds up its end nicely, though, ripping off clean, satisfying, and quick upshifts at redline.

The lack of a V-8 doesn’t completely account for the nearly $10,000 price difference between the ML350 and ML500. Popularly priced ML350s, costing about $50,000, won’t have full leather seats. Our sample had a manual tilt steering wheel, manual front headrests, and a manual tailgate lift/closure versus power controls in our full-tilt $64,000 ML500. The one infuriating omission is that the ML500 has a handy extra drawer in the center stack of the dash, good for mobile phones and key cards, and it’s not included in the ML350. Why? To remind you that you only spent 50 large on your crossover SUV? The ML350 also lacks the ML500’s optional three-position adjustable suspension damping, although handling is plenty decent without the option. The ML350 takes a fast curve with substantial roll, but has good grip and a feeling of control and enough feedback to keep you out of serious trouble. The ML350’s steering is, however, too light on-center, a problem we don’t have with the ML500.

So is the V-8 worth it? Yes–it’s a hot-rod in suburbmobile’s clothing.

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